Real Estate Insider: February 2019 News Report

Welcome back! This month we compiled a set of topics fit for home owners and investors alike to help you weigh your options before making some of the big decisions in real estate.


If you are thinking of investing in commercial real estate (CRE), this article does a fantastic job of laying out the basics of all aspects of CRE to help point you in the right direction. After reading this, give us a call to learn more! >>

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Don’t be surprised, be prepared! Renting Vs Buying is an age old debate. While this isn't one of those articles (it kind of is), it simply breaks down the hidden costs of home ownership that many people don’t consider when contemplating purchasing a home. >>

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Radon, the silent killer. Make sure you know if you are at risk of harmful radon gas because it is one of the most preventable cause of lung cancer there is! Read here to find out what you need to know. >>

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Your ego might like the big house, but your back and wallet won’t. Here are 6 reasons to avoid buying a large house. >>

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Do you have foreign investments and want to buy a home in Canada? This article can explain some of the hoops you’ll need to jump through and some of the calculations you need to consider before making the leap. >>

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Winter is considered the real estate “off-season” because there are less listings, less buyers, and less motivation to go out and look at houses. Read why these are the perfect reasons to buy during this time! >>

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Thinking of buying an investment property but don’t have the down payment in your bank account? Have you thought about a home equity line of credit (HELOC)? Whether you have, or you have no idea what that is, this article is for you. >>

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Ever thought of what would happen to your mortgage if you pass away? This article walks you through multiple scenarios if this question ever crossed your mind. >>

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5 tips from a lawyer to make sure you are protected in 2019! >>

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What’s going on with mortgage rates? Make sure you do your research before your next renewal so you get the best rate possible. You can start with this video! >>

Real Estate Insider: December 2018 News Report

Merry Christmas and a Happy New Year, Real Estate Insiders! 2019 is just about to start, so we thought we'd put together a handy collection of topics perfect for planning your new year resolutions on your property. When you have a few moments of rest from the hustle and bustle of the holidays, be sure to grab your favourite holiday beverage and check out just a few of the ways you can be prepared for the biggest plans of 2019!

Thinking of doing a huge home renovation? There’s no better advice to get than from someone who’s done it! Read this couple's 6 biggest lessons they learned while putting an addition on their home so you can prepare and limit the number of surprises along the way! >>

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Would you trade paying more interest overall for a lower monthly payment? That’s the argument this article is making for the 30-year mortgage in the wake of rapidly rising interest rates. Overall it is personal preference, so which is yours? >>

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Ever wonder what happened to the people who started investing in Real Estate right before the 2008 crash? Read this article to find out the biggest mistakes this Real Estate investor made when he started out, and how he eventually bounced back. These tips could help fast-track you to financial freedom! >>

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Don’t be afraid to ask the hard questions when it comes to your money and don’t let a shady salesman pressure you into signing anything you don’t fully understand! Here’s a list of 4 big rip-offs to look out for to help save you money. >>

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Preparation is the name of the game when it comes to investment properties. Make sure you’re prepared for many of the aspects of owning different types of investment properties! >>

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Step 1: Buy gifts.

Step 2: Spend time with loved ones.
Step 3: Shovel and salt the sidewalk.

Step 4: Go over your year-end financial planning checklist—we can help you with this last one! >>

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Owning a cottage or vacation home is a goal many people have, but does it make sense overall? Read here for some considerations to help you make this big decision. >>

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AirBnB is being used by many as a source of income to help offset the price of owning a home or investment property. Are you aware of the short and long term tax implications? Read here to see why it could end up costing you way more than expected. >>

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Team Lalovich never cuts corners when it comes to selling real estate, and neither should any other Realtor! Unfortunately, there will always be some that find the worst possible ways so save a quick buck; if it affects the sale price of your home, it should be a deal breaker! Make sure your Realtor of choice is doing everything they can to provide you with the best service, starting with the photos. >>

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“The Bank Profit Indicator shows the amount of profit per man, woman and child in Canada.” Find out this years number here! >>

Real Estate Insider: October 2018 News Report

Hi there, readers! With new local real estate developments and a continuing housing war, we thought we'd bring you a collection of reading just for the occasion. Take a look as we cover renovation tips, the benefits of living small, how to whittle down that mortgage, and more!



More often than not, renovations increase the value of your home. Everyone should be careful of renovations that are only improvements in their eyes! This article lists 7 home renovations that might not help the re-sale value of your home. >>

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Monthly mortgage payments is something every homeowner has to deal with. There are many different theories and strategies that go with paying off your mortgage, but have you ever heard of a sinking fund? If not, you can read all about it here! >>

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There’s one thing standing between the house size you think you need, and the house size you actually need: your ego. Set it aside and read the benefits of owning a smaller home. >>

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Condo popularity is growing in the Windsor-Essex area, and they are popping up all over! If you’re thinking of buying a condo make sure to keep these tips in mind so you don’t have any surprises after you make the big investment. >>

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House flipping is rapidly gaining popularity and can be a great way to earn extra cash to set yourself up for financial freedom. However, like many things, it’s not as easy as it sounds. Read this article for some things to consider before diving into a flip so it doesn’t turn into a flop. >>

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Investing in a vacation rental could be the perfect opportunity to finance a vacation spot for you and your family—if you’re willing to put in the work! As always, we want you to stay informed on all decisions involving real estate, so if you’re thinking of investing in a vacation home, be sure to read this article first. >>

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Getting your home ready for an inspection is a win-win for everyone; doing it right is important! This article does a great job at listing the simple things you should do pre-inspection to assure you get the highest price for your home. >>

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It’s easy to make mistakes when first starting anything, but some “rookie mistakes” can end up costing you a lot of money! Be sure to avoid the common ones by reading this article, and get yourself ready for a successful investment property! >>

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Does the thought of your mortgage constantly stress you out? If you want to live mortgage free, you can start by reading these 12 tips on how to reduce that pesky mortgage. >>

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How would you feel about having a neighbour that frequently rents out their home short term? Are you with the majority of Canadians? Find out here! >>

Real Estate Insider: September 2018 News Report

Welcome back, Real Estate Insiders! This month we have a solid list of topics ranging from finding the perfect tenant to the latest craze of remodelling. We hope you have a cup of coffee and are ready for some of the most informative reads we've ever found. Enjoy!

Title insurance is a closing cost that everyone seems to question, but do you really need it? Well the short answer... is YES! Read how title insurance can save you from financial and personal stress.

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While not everyone might know what “Sequence Risk” is, it affects everyone the same. This is why you need to eliminate as much sequence risk as possible! Real Estate is a great way to significantly reduce this risk and this article explains why.

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Are you buying a new home or condo? Make sure to be caught up on the HST rebate rules so you don’t miss out on huge savings!

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True or False: Windsor is the most affordable city to buy a house in all of Canada. Find out the answer here!

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Remodelling is a rising trend among homeowners that doesn’t seem to be slowing down! But there are negative effects not shown on HGTV. Read them here.

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Cannabis is being legalized in less a month! Here are 5 things you should know now to stay informed.

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In trial separations it is sometimes unclear how the real estate is going to be divided among the family. This article can help with that part!

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Making sure you have good Tenants can make or break a rental property, so don’t leave anything to chance! Read the ultimate screening process here so picking good Tenants can be easy.

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The first year of anything you do usually has the biggest learning curve, so this article of 5 Lessons that Chris Mamula learned in his first year as a Landlord should help ease that curve! 

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Real Estate Investing isn’t only for the rich! Read here for an example of how to invest in a rental property with little to no down payment.

Real Estate Insider: July 2018 News Report

Welcome back everyone! With more than a few hot topics this month, we've made sure to scope out the best reads you won't want to pass up. Do you agree with condos banning smoking with the legalization of marijuana? What is the issue with having Kitec plumbing on your property? How can you save money on your flooring renovation? We'd love to hear your feedback on these topics plus more in this edition of the Real Estate Insider!

Everyone knows the phrase “Location! Location! Location!” when buying a home or business. There are many factors that can increase, or decrease the value! Which do you think living next to a cemetery will do? Find out here! >>

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Building your dream home? Congratulations! While this is an exciting time, we want to make sure you are getting the best tax return on your current home as possible! This can be a tricky situation, read this article to get started! >>

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You don’t have to start with a lot to become a successful real estate investor. Read how at 27, Paula Pant was paying $400 a month in rent to share a kitchen and bathroom with roommates, and at 34, she now has 8 homes!  >>

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Don’t let your ego get in the way of your financial strength! Read here for various reasons why you should put your ego aside when thinking about buying a home. >>

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Ahead of the legalization of recreational marijuana, some condos are taking pre-emptive steps to make sure they ban smoking on their properties. Do you agree or disagree with this move? Read more here. >>

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The age-old question of “fixed vs. variable” mortgage rates continues in this article following the rumours of another rate increase before the end of 2018! Read here. >>

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A deceased person could have assets not controlled by their executor. Who is entitled to these assets? Read here for some insight on the different parts of an “Estate Pie” and who all gets a slice! >>

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Kitec plumbing could be an issue when buying or selling a property that contains it. Watch this video for 5 things to know about Kitec plumbing! >>

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Pooling resources can be a great idea when buying or renting a home to get more for your money, as long as everyone is protected! Read here for tips to avoid costly or ugly scenarios down the road! >>

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Floors are often the last things to go into a renovation project, so make sure to finish strong! Here are 5 ways to save money on flooring. >>

Russel's Review: The Real Estate Retirement Plan By Calum Ross

A lot of people ask us for recommendations on real estate and related books to read.  Well, today we are going to start a new periodic series on the blog that reviews recent real estate books that we’ve read.  So without further ado, here goes…

What is the Book?

The Real Estate Retirement Plan – An Investment and Lifestyle Solution for Canadians by Calum Ross with Simon Giannini.

What You'll Learn

The book starts by talking about traditional retirement and why, for many reasons, today’s younger and middle aged population will not be able to look forward to some of the typical retirement income sources of previous generations (ie workplace pensions, generous government entitlements, etc). The population needs to prepare itself for funding their own retirements going forward.

It then segues into a "good debt vs bad debt" discussion about how the public has no problem borrowing to buy depreciating assets like cars or other toys, but find it risky to borrow to invest and buy cash flowing and appreciating assets (ie real estate or equities). People need to start viewing their personal balance sheet more like a corporation, get rid of their bad debt, and also convert their dead equity (ie equity in their personal residence) into productive equity by using it to invest.  The best way to do that for most people would be to refinance equity in their home to buy additional investments, either cash flowing real estate or dividend paying equities. Come retirement time, this strategy should pay off in spades, and the author shares many examples.

Later in the book it talks about building your team, such a mortgage broker and real estate agent, and later about investing in real estate and how to profit from this borrow to invest strategy long term.

Why I Recommend It

I agree with the majority of the concepts in the book and put them into practice personally and with our clients all the time.  It's especially good for beginners as it's written with easy to understand terms.

My Critique

Some of the examples used I thought were pretty rosy. This is definitely not a get rich quick concept; more of slow, steady climb in wealth concept. Don’t want to people thinking this stuff is easy!

So there you have it folks.  Our first book review on the blog. If there are any other books you are interested in hearing about feel free to drop us a line ☺.

Check out our video review of this book here!

You can order a copy online today at Amazon and Indigo. Happy reading!

Bonus: Investing In Real Estate – Building the Right Team: Mentors & Education

Ask any successful real estate investor and they’ll be sure to admit that they haven’t invented the wheel. They have taken ideas and concepts from other landlords and incorporated them into their investing business. The learning curve is much easier when you aren’t starting at square one.

Why do I need a mentor?

One of the best ways to learn the tricks of the trade is to find a mentor who is a successful real estate investor.  It's often that successful landlords enjoy talking real estate and will be happy to share some info. Pick their brain. Even if you take a few concepts, or learn to avoid a few mistakes over time, they can make you money or save you big money long term.

How do I find a mentor?

The best way to find a mentor, or like minded real estate investor, is to network. Look to see if there is some sort of real estate investment club in your local area. Talk to your realtor or other professionals on your team to see if they know of anyone they can refer you to. Networking is key in any business and having successful contacts can very much help you investing business.

What else should I know about staying educated?

Besides having a mentor, it is important to keep investing in yourself as a real estate investor. Continual learning will improve your understanding of the business and keep you sharp. There are numerous books on the subject, online classes, in-person seminars, and of course, blogs (like this one ☺) that have lots of information to keep you up-to-date on what is happening and what you need to know in your market.

Don’t be lazy. Aim to improve yourself continually and your investment business will thrive. Readers, do you have a mentor? What do you do to keep continuing your real estate education?

Investing In Real Estate – Building The Right Team #7: Bookkeeper

No one will ever care as much about your investment property as you do. But what exactly should you care about most as an investor? The short answer is: how much money you’re making! The funny thing is a lot of investors don’t actually know how well their investment property is performing. Don’t be one of those people! Today we are going to talk about the next member of your team, which will help you with this problem…your bookkeeper.

Do I really need a bookkeeper?

Technically, you don’t need one. You can do the bookkeeping yourself if you work with a simple spreadsheet or an accounting software such as quickbooks or simply accounting. Just make sure you keep detailed records and ensure you input all the income, expenses, etc, properly and allocate it to the right property. When you start out, it's often a good idea to start doing your own books so you can learn. As your portfolio grows, you will want to consider delegating the task to a bookkeeper.

What will my bookkeeper do for me?

A bookkeeper will input all income and expenses into whatever accounting software you use. They will keep neat records so when tax time rolls around, you have everything handy. They will also run regular reports (ie. monthly, quarterly) so you can track the performance of your investments.

What else should I know about bookkeeping?

The biggest aspect of bookkeeping is measuring performance. If things are going well and as good or better than expected then you want to keep up the good work to make sure things don’t slip. If things aren’t performing so well, it allows you to look at where the numbers are going wrong and make some changes (ie. increase rents, renovate, implement energy efficiency updates). And if after doing all you can, and after continuing to monitor the performance, it doesn’t turn around, maybe it wasn’t a good investment and its time to sell and move on.

How much will my bookkeeper cost?

As in the rest of the your team members the cost will vary, but bookkeeping is a highly automated process so the rates in your area should be pretty standardized. Either a per hour amount or a monthly fee is most common. Also make sure to check the work to make sure they are doing a good job with minimal errors and making it worthwhile for you.

The bottomline is that understanding your investment properties performance is very important and not a task to be taken lightly. Consider hiring a bookkeeper to make sure this is taken care of properly.

Do you do your own bookkeeping or outsource it for a bookkeeper?

Investing in Real Estate – Building The Right Team #4: Accountant

As the saying goes, “The only two certainties in life are death and taxes.” Continuing on in your journey of investing in real estate and building your team, you’ll need a good accountant to figure out the latter. Today we are going to talk about why you need a good accountant on your team and how they can help you succeed.

Why Do I Need An Accountant?

The main function of your accountant in relation to your real estate investing is to help figure out the taxable rental income attributable to your rental properties. They will help with filing your tax return, and provide advice relative to your situation and any tax planning that is necessary. All this would also apply to your employment income (if your employed) as this would all go on the same tax return.

How Will My Accountant Help?

Outside of the filing of tax returns, your accountant will help with general tax advice and planning.  Decisions an accountant can help with include:

• Can you expense or amortize a certain repair or renovation?
• How much depreciation expense should you take?
• When is a good time to sell based on tax consequences?

An accountant will also help should you ever get audited by CRA. Basically they will help you within existing tax laws to maximize your after tax rental income, which is really what investing is all about.

What Should I Look For In An Accountant?

As a real estate investor, it is a definite plus to deal with an accountant that has lots of experience with real estate investors. Ask for references from other investor colleagues. Having an accountant with a Chartered Accountant designation is also huge plus.

How Much Will My Accountant Cost?

This will vary depending on your tax situation and the accountant you use. Some charge a flat rate for a comprehensive tax return and some charge per hour. One way to lower your bill will be to have all your paperwork organized for tax time so your accountant isn’t drowning in paperwork. This can be done with bookkeeping software such as Simply Accounting or by hiring a bookkeeper to keep proper records of everything.

In the business of real estate investing, it’s not what you make, it’s what you keep. You also need to be aware of exactly how much your investment properties are making so you can make any necessary changes to ensure your success. Keep diligent records with the help of your accountant and your cheque book will be happy you did!

Investing In Real Estate – Building The Right Team #3: Mortgage Broker/Professional

As you continue your journey in real estate investing, unless you are buying a property with all cash (in that case can you lend us some ☺?), you’ll eventually need to get a mortgage. But how do you go about doing that? Today, we are going to talk about the next member in building your real estate team: the mortgage broker/professional.

Why do I need a Mortgage Broker/Professional?

The main function will be securing the mortgage for your property purchase. They will also run your credit and applications and move the mortgage along from the initial application phase to giving mortgage instructions to your lawyer for closing.

What will my Mortgage Broker/Professional Do For Me?

Aside from the actual securing of the mortgage, they will shop around to get you best rates, advise you on the best products for your needs and make you aware of any potential pitfalls of a certain type of mortgage. They basically work with you to ensure your interests are taken care of in securing the mortgage.

How Is Financing My Investment Real Estate Different From My Personal Residence?

Financing a personal residence is typically much easier than investment properties. On a personal residence the lender will look at your income and based on that decide how much you can qualify for based on certain ratios. Investment properties are different as they incorporate rental income and so weight is given to income and expenses of the property. There are also different rules ie. you can put as low as a 5% down payment on a principle residence(with mortgage insurance), with investment properties that is usually 20-25% down.

What Else Should I know And Will My Mortgage Broker Be Aware Of?

It is important that your mortgage broker/professional be aware of your goals as an investor. The planning for the future can be much different if you plan on only owning 1 or 2 properties as opposed to 10 or 20. Sometimes it is better to choose lenders with higher rates or less attractive terms, if it helps you down the road qualifying for more mortgages as your portfolio grows. They should help immensely in this regard. Therefore it is a real bonus to work with a mortgage broker/professional that has plenty of experience working with investors.

How Much Will My Mortgage Broker Cost?

Typically the mortgage broker/professional is compensated by the lender with a built in commission into the interest rate. So essentially they are working for you, at no direct cost to you as a buyer!  Check with them on this though as your situation may be unique and may require different services. Note: You will typically have to pay an appraisal fee once you have a property under contract and a mortgage commitment has been given. This will range between $200-500 for a residential property. Sometimes the lender or mortgage professional/broker will take care of this fee.

So there you have it readers. You now know about how important financing is to your real estate investment future. Choose your team member wisely and you’ll be thankful later!

Investing In Real Estate – Building The Right Team #1: Realtor

Last week, we briefly reviewed a list of the team you should consider building if you want to become a real estate investor. Over the next set of posts, we will elaborate on some of these team members and what you should know. To begin, we will start with arguably the most important member of your team... the realtor ☺.

What should you look for when choosing a realtor to help you with investment properties?

Consider a realtor who specializes in income properties, or at least has significant experience with dealing with investor clients both on the buying and selling side. Ask for a list of properties they have worked on and possibly for references. It is also a huge bonus to have a realtor who is an investor themselves. They will be able to speak from first-hand experience and should be able to offer excellent insight. Choosing the right realtor is especially critical when investing outside of your home market, where you’ll be relying on them more for information about that market.

In what ways will my chosen realtor help in the process?

Your realtor should meet with you, understand your goals for investing and gauge your financial and management abilities to invest in properties. They should provide you information about the rental market, including rents, vacancy rates, employment info, demographics, municipal and fire code regulations, neighbourhood info and more. At this point you should be ready to look into specific properties and narrow down your focus to the right property for you. After finding the right property, your realtor will handle offer negotiations, facilitate inspections, appraisals, etc. to meet conditions and generally handle the sale right through to closing.

In what ways can my realtor go over and above?

Your realtor should have ideas and insights to help you be successful. They should understand the rental market and what makes a unit marketable to tenants. They can provide advice regarding value added renovations, marketing of vacancies, how to handle tenant inquires and applications and general maintenance of the property to keep things moving steadily. They can also provide referrals to other professionals for your team, including lawyers, mortgage brokers, insurance brokers, building inspectors, management companies, etc. Lastly, they should protect your interests at all times. They should see red flags such as blatant fire code violations, undesirable tenants, inefficiencies (electric heat loss) and other potential headaches of future problems.

This is a brief discussion about what to look from your realtor when looking at investing in real estate. It should give you some guidelines to get you started. Good luck!

Growing Trends for 2016 Real Estate - Crowdfunding

Have you ever wondered what it would be like to own a large commercial property (i.e. retail plaza, office complex, high rise apartment building), but unfortunately don’t have the millions of dollars in the bank to make it a reality? Well the rise of crowdfunding in real estate might just be the opportunity you’ve been looking for.

But first, what exactly is crowdfunding and how does it work?

You might be familiar with fundraising sites such as Go Fund Me or Kickstarter, or US based peer-to-peer lending sites such as Prosper or Lending Club. Crowdfunding for real estate is similar to these platforms and the basic premise is simple. An investor can access individual real estate properties through an online platform and pool money with other investors to invest the required funds for a property. Say for example, the property cost $10 million dollars, it could be split into 10,000 shares of $1,000 each or 0.01% ownership for each share.

Real estate crowdfunding falls into two sub-groups: debt and equity.

In debt crowdfunding the investors act as a lender for, rather than as, the owner of the property. In such circumstances, the investment would be secured by the property and the investor would be entitled to monthly interest and a return of principal, but not to any benefit from property appreciation.

In equity crowdfunding, the investor becomes an indirect owner of the property by obtaining shares, limited partnership units, or other securities in the entity that owns the property/project. This form of investment carries inherently more risk, but also a potential greater return as a result of a direct interest in the property appreciation.

Crowdfunding for real estate is still in its early days in Canada. However, it has been making significant inroads in the US. The Ontario Securities Commission has been reviewing the industry as it matures and tries to regulate to protect investors. So check back often on the regulations as the industry matures in 2016.

Though crowdfunding will allow more people access to the commercial real estate market, for companies being able to solicit investments in projects from the general public online both greatly increases companies’ ability to raise the capital they need, from a greatly expanded pool of potential investors, but may also greatly increase the likelihood of lawsuit, especially if the investment performs poorly.

So there you have it. We are on the precipice of “the democratization of the real estate investment opportunity”. Are you excited?

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Russel Lalovich
russel@lalovichrealestate.com
Office: (519) 966-0444
Cell: (519) 995-5620